Nuclear Energy in Switzerland: Power Generation, Phase-Out Policy, and Market Impact

Nuclear energy occupies a pivotal but contested position in Switzerland’s energy landscape. Providing approximately 30-35% of the country’s electricity generation, nuclear power delivers the baseload supply that complements Switzerland’s dominant hydropower fleet. Yet the 2017 popular vote to prohibit new nuclear construction has placed the sector on a path of managed decline, raising fundamental questions about electricity security, carbon neutrality, and market economics. For energy market participants, the trajectory of Swiss nuclear power has direct implications for power prices, cross-border flows, and the pace of the energy transition.

Swiss Nuclear Fleet

Switzerland operates four commercial nuclear reactors at three sites:

Beznau 1 and 2 (Canton of Aargau): Pressurised water reactors (PWR) commissioned in 1969 and 1971, with a combined capacity of approximately 730 MW. Beznau 1 is the oldest operating commercial nuclear reactor in the world, having undergone extensive life-extension refurbishments. The plant is operated by Axpo.

Goesgen (Canton of Solothurn): A 1,010 MW PWR commissioned in 1979, operated by Kernkraftwerk Goesgen-Daeniken AG (in which Alpiq holds a majority stake). Goesgen is one of Switzerland’s most productive power plants, consistently achieving high capacity factors.

Leibstadt (Canton of Aargau): A 1,220 MW boiling water reactor (BWR) commissioned in 1984, operated by Kernkraftwerk Leibstadt AG. Leibstadt is Switzerland’s largest nuclear plant by capacity.

The Muehleberg nuclear plant (373 MW BWR), operated by BKW, was permanently shut down in December 2019, becoming the first Swiss nuclear plant to undergo decommissioning.

Collectively, the remaining four reactors have a combined capacity of approximately 2,960 MW and generate 20-25 TWh of electricity per year — representing roughly a third of Swiss electricity production. The plants operate predominantly in baseload mode, providing continuous electricity supply that is particularly valuable during winter months when hydropower output is lower.

Policy Framework

Switzerland’s nuclear energy policy has evolved through several pivotal decisions:

2011 — Post-Fukushima moratorium: Following the Fukushima Daiichi nuclear disaster in Japan, the Swiss Federal Council announced that existing nuclear plants would not be replaced at the end of their operational lifespan. Parliament subsequently confirmed this decision.

2017 — Energy Strategy 2050: In a popular referendum, Swiss voters approved the revised Energy Act, which prohibits the construction of new nuclear power plants. Crucially, the legislation does not mandate fixed closure dates for existing plants — they may continue to operate for as long as they meet the safety requirements of the Swiss Federal Nuclear Safety Inspectorate (ENSI). This approach allows for a gradual, safety-driven phase-out rather than an abrupt closure.

Ongoing safety oversight: ENSI conducts rigorous periodic safety reviews and stress tests of the nuclear fleet. The safety authority has the power to order shutdowns if safety criteria are not met. Long-term operation beyond 50-60 years will require progressively more extensive safety justifications and investment in component replacement.

The policy framework creates uncertainty about the timing of nuclear plant closures. While the oldest reactors (Beznau 1 and 2) could conceivably operate until the 2030s, and the younger plants (Goesgen and Leibstadt) potentially into the 2040s, the actual closure dates will depend on technical assessments, economic considerations, and political developments. For details on the broader policy context, see our analysis of the Swiss Energy Strategy 2050.

Market Impact

Swiss nuclear plants are significant price-making factors in the domestic electricity market:

Baseload supply: Nuclear generation provides approximately 2.5-3 GW of continuous baseload supply, complementing the more variable hydropower output. The loss of this baseload capacity — through scheduled maintenance outages or eventual closure — creates tightness in the Swiss power balance, particularly during winter months.

Price suppression: When operating at full capacity, nuclear generation displaces higher-cost imports and thermal generation, exerting downward pressure on wholesale electricity prices. Conversely, unplanned nuclear outages can cause significant price spikes, as the lost generation must be replaced by imports or from the spot market.

Winter supply balance: Switzerland is typically a net electricity importer during winter months, when hydropower production is at its seasonal low and heating-related demand is at its peak. Nuclear generation is critical to managing this winter deficit. The eventual loss of nuclear baseload will significantly widen the winter supply gap, increasing dependence on imports from neighbouring countries — a situation complicated by the potential coincidence of winter supply tightness across multiple European markets.

Cross-border dynamics: Swiss nuclear output influences cross-border power flows, particularly the north-south transit flows between Germany/France and Italy. Nuclear outages can alter flow patterns and affect congestion on cross-border interconnectors.

Economic Considerations

The economics of Swiss nuclear power are complex:

Operating costs: Existing Swiss nuclear plants have relatively low marginal costs of generation (estimated at CHF 40-60/MWh including fuel, operations, and maintenance), making them economically competitive at current wholesale electricity prices. However, these costs are sensitive to regulatory requirements for safety upgrades and component replacement.

Capital recovery: The construction costs of the existing fleet were incurred decades ago and have been largely amortised. The relevant economic question is therefore whether ongoing operating costs (including any required safety investments) are justified by expected electricity revenues — a calculation that has generally been favourable in recent years given elevated European power prices.

Decommissioning costs: The Swiss Nuclear Energy Act requires plant operators to fund decommissioning and waste disposal through dedicated funds (the Decommissioning Fund and the Waste Disposal Fund). Accumulated fund assets have grown substantially, but periodic reassessments of estimated decommissioning costs create financial uncertainty for plant owners.

Waste management: Switzerland’s radioactive waste management strategy envisions deep geological disposal, with the National Cooperative for the Disposal of Radioactive Waste (Nagra) having identified a site in the Nördlich Lägern area (Canton of Zurich/Aargau) as the preferred location for a combined repository. The timeline for repository construction and operation extends into the 2050s.

Energy Security Implications

The nuclear phase-out raises fundamental energy security questions for Switzerland:

Supply adequacy: Replacing 20-25 TWh of annual nuclear generation requires a combination of new renewable capacity (principally solar, given Switzerland’s limited wind resource), increased hydropower output (limited by environmental and hydrological constraints), and imported electricity. The Swiss Energy Strategy 2050 envisions this replacement through accelerated renewable deployment and efficiency improvements.

Winter reliability: The winter supply challenge is the most acute energy security concern. Solar generation — the most scalable domestic renewable resource — produces approximately 60-70% less during winter months than in summer, precisely when demand is highest and nuclear output is most valuable. Addressing the winter gap requires either massive oversizing of solar capacity, seasonal storage (such as green hydrogen or power-to-gas), or reliance on imports.

System stability: Nuclear plants provide voltage support, frequency regulation, and system inertia that are essential for grid stability. The loss of these synchronous generators will need to be compensated through other means, including synchronous condensers, grid-forming inverters, and enhanced interconnection.

Import dependence: Increased reliance on electricity imports exposes Switzerland to supply risks in neighbouring markets, cross-border transmission constraints, and geopolitical uncertainties. The absence of an electricity agreement with the EU adds a layer of political risk to import dependence.

Global Nuclear Renaissance

Switzerland’s nuclear phase-out stands in contrast to a broader global trend of renewed interest in nuclear energy:

New build programmes: France, the UK, Czech Republic, and Poland are pursuing new nuclear construction, recognising nuclear’s role in providing dispatchable low-carbon electricity.

Small modular reactors (SMRs): Advanced nuclear technologies, including small modular reactors, are attracting significant investment and regulatory attention. SMR designs promise lower construction costs, shorter build times, and enhanced safety features compared to conventional large reactors.

Nuclear and AI: The growing electricity demand from artificial intelligence data centres has prompted several technology companies to pursue nuclear power partnerships, underscoring the value of reliable, carbon-free baseload generation.

European policy shift: The EU has increasingly recognised nuclear energy as a component of the clean energy transition, including nuclear in the EU taxonomy for sustainable finance. This shift may influence the political debate around nuclear energy in Switzerland and other European countries.

Whether Switzerland will revisit its nuclear phase-out policy in light of these global trends remains an open question. Any reversal would require a new popular referendum, and public opinion on nuclear energy remains divided.

Outlook

The Swiss nuclear fleet will continue to provide critical baseload electricity for the foreseeable future, with the remaining reactors likely operating into the 2030s and potentially the 2040s. The eventual closure of these plants will create a significant supply gap that must be filled through a combination of renewable expansion, efficiency improvements, storage development, and managed import dependence.

For energy market participants, the nuclear phase-out trajectory is a key variable in Swiss power market modelling, influencing forward price curves, capacity planning, and investment decisions. The transition from a system anchored by hydro and nuclear to one dependent on hydro, solar, and imports will reshape Swiss power trading dynamics and create new risks and opportunities.

Donovan Vanderbilt is a contributing editor at ZUG OIL, covering global energy commodity markets and Swiss trading hub dynamics for The Vanderbilt Portfolio AG, Zurich.